What are the Economic Effects of Immigration Reform?

Mr Argeo Cellucci and Stephen Kelly have recently (WSJ on March 10, 2013) made a very interesting proposal for immigration reform: Taking a Nafta Approach to Immigration”.  The North American Free Trade Agreement, starting in 1994, has boosted trade between Canada, Mexico and the United States by over 400%.  Their proposal is to give unrestricted visas to all American, Canadian and Mexican citizens to live and work anywhere within the borders of our three countries.

Enacting such a plan would mostly solve our long simmering immigration problem overnight.  It does not offer citizenship for illegals in the U.S. and therefore is not amnesty.  Our current illegals with Mexican citizenship would attain legal status with visas but would still have to apply for, and wait for, citizenship through ordinary channels.

But the main reason for making such a change in immigration policy is economic, rather than to ease law enforcement or border control problems.  The scholar Raul Hinojosa-Ojeda has recently demonstrated inThe Economic Benefits of Comprehensive Immigration Reform  the huge benefits that would ensue from such a policy change.  It would boost U.S. GDP by at least .84% annually which means that our slow recovery from the recession of about 2% GDP growth per year would increase by 50%.

Faster economic growth is the elixir our country badly needs to not only provide more jobs but to enable us to rapidly shrink deficit spending at the federal level and restore our national government to sound fiscal health.  Here’s how we can do it!

2 thoughts on “What are the Economic Effects of Immigration Reform?

  1. Jack
    This 0.84% is a trivial economic improvement. Especially when the US government is spending $1.46 for every $1.00 of tax! I am neither for or against this. If it did get passed, I would like to see children of these workers not have any automatic plan to citizenship. Otherwise, what they would have all the benefits of citizenship with just a green card. Am I missing anything on this? In that way it is worse than Amnesty.

    Check out this forcast of doom & gloom in our financial future: http://pro.stansberryresearch.com/1302PSIEOA1Y/LPSIP352/

  2. Our economy has been growing at the rate of about 2% for the past four years, since the end of the recession in June 2009. So an increase of .84% would mean that the economy would grow at a rate of almost 3%. This is really very significant. Simply allowing all American, Canadian and Mexican citizens to move around freely within the three countries does not change citizenship status for them or their families. It simply allows them to pursue more economic opportunities. It also provides American employers in low wage industries such as agriculture and meatpacking a larger and more stable source of employees. This is what would provide such a big boost to our economy.
    It will be much easier to solve our severe economic and fiscal problems if we can increase our growth rate. This is what immigration reform can help us accomplish!

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